Why Is The Council Asking For My Bank Statements?

If you are wondering why your local council office is asking for your bank statements, you will find the answer to your question in the following blog post. In addition to this, you will also find guidance on who else is authorised to access your bank statements; as well as your bank account (under specific circumstances).

Why Is The Council Asking For My Bank Statements?

Your local council office can ask for your bank statements as proof of your identity and as

as proof of your income and savings especially in cases where:

• you have applied for council housing
• you have applied for Council Tax Reduction
• you have applied for Housing Benefit or Pension Credit

You can only claim council housing if you are on a low income. Your bank statement will provide evidence in support of your claim for council housing and can also help in increasing your rank on the priority list if you are on a low income. This means that your income or savings should be below the median income within a given year.

If your income or savings are more than £6,000 and you are of working age (£10,000 if you are of state pension age), your Housing Benefit and Council Tax Reduction claim will reduce proportionate to the excess amount you have in your bank account over and above the minimum threshold. If your income or savings are more than £16,000, you will not be able to claim Housing Benefit. 

When the council asks for your bank statements (this can be for the recent 2 to 3 months or even upto 6 months in some cases), they are usually looking for the following information:

• your income and its frequency; how much you earn and when are payments usually paid
• the regularity of your income: whether you have a stable source of income and will be able to afford rent
• your expenses; the amount of money you spend every week
• the ending balance each month; which should ideally be in credit without any overdrafts
• your savings; whether you have access to savings to pay rent on time and whether the amount is below the threshold that makes you eligible for benefits and council housing

Is There Any Other Financial Information That The Council Can Ask For?

Yes, there are other financial (and even personal) documents that the council can ask you for as evidence of your income and capital. They generally ask for the below-listed financial documents but can also demand any other piece of information that is relevant to your circumstances:

• Recent payslips 
• P45 or P60
• Pension statement 
• Student financial support notice 
• Trading accounts
• National Insurance number card
• Child Benefit and Tax Credit award letters  
• Benefit award letters from Jobcentre Plus or The Pension Service
• Building society or post office account passbooks or statements
• Share certificates and dividend statements for stocks, shares or bonds

In addition to this, details of the income and capital of other household members can also be demanded by the council; whether or not they are your dependents.

Can The Council Check My Bank Account?

While the local council authorities will not monitor your bank account regularly, if they suspect you of council tax fraud, they can gain access to your account in liaison with the DWP and HMRC.

However, the following authorities can not only monitor your bank account but can also take money directly from your account to pay off any debt that you owe them:

• HM Revenue & Customs has access to your bank account information and can take money directly from your account to pay off any tax debt that you may have.
• The Department for Work and Pensions also has access to your bank account and will take money from your account if you have overpaid benefits, are suspected of benefit fraud or if you owe money to the government.

Additionally, credit agencies can also check your bank account to advise lenders in deciding whether or not you should be given a loan.

Conclusion:

The above discussion helps to conclude that the council office will usually ask for your bank statements to assess your income and capital. This usually happens when you apply for a welfare benefit such as Housing Benefit or Council Tax Reduction or claim council housing for being on a low income. 

References:

Information you need to provide | Islington Council

Examples of evidence of income and capital. | The evidence you need to send us for Housing Benefit and Council Tax Support

How The Horrors Hidden In Tenant’s Bank Statements Affect You – Luscombe & CO